[anonymous]

Can you give me an example buddy lol?

So the client is a restaurant, with 650 FICO, clean banks, no liens, no outstanding MCAs, no prior bankruptcies, no issues with their landlord, 3 years in business and doing $500,000 a year in sales. Prefers a quick turnaround of 6 months.

Broker A: Offers $30,000 on a 6 month payback, with a 1.35 factor as a merchant cash advance from a company that is doing the underwriting process mainly by manual review which means the process will take longer.

Broker B: Offers $30,000 on a 6 month term, with a 1.18 as an alternative business loan from a company that has majority of the underwriting process automated so that the closing process takes about a day.

Can you give me an example of what Broker A is going to say, to convince said merchant to use him over Broker B? I agree with you that it's not just about pricing, it's about the entire scope of the deal, but what could Broker A possibly say to win this deal from Broker B?

Broker A will be selling the dream, rather than the product. Happens every day. A good salesman can close an inferior deal, have seen it done many times, and have even done it myself once or twice.

[jotucker1983]

These are great points, would you mind if I printed them out and gave it to a few of the newbies here?

Sure , maybe you could just link it back to this thread or just reference me in the material?

Broker A will be selling the dream, rather than the product. Happens every day. A good salesman can close an inferior deal, have seen it done many times, and have even done it myself once or twice.

Give me an example? I've heard this before and this mantra is common place amongst Sales Managers, but in my opinion it just doesn't make any sense.

What are the value point arguments (that matter to the merchant) that you are going to say to convince them to pay $5,100 more with you than with the competing offer with Broker B?

If I were Broker A and had literally no choice in the matter, I would probe to see if there are origination fees on the table, probe to see if that's the "final offer" or a teaser rate, as well as explain the long-term planning aspects in terms of reloads as the competing offer will more than likely have them paying "interest on top of interest" during renewals. But what if the merchant doesn't want to use this for the long term? What if they are just looking at doing this for 6 months and that's it?

But thank goodness I'm not Broker A lol, the pricing for that deal in the example isn't efficient considering it's an A Paper deal. It's bad pricing and the only way that merchant is getting closed is if they don't shop, don't get another call from a competitor, and/or are already within the process with you with a "rush" to get some type of funding (thus they don't have time to restart the process with someone else).

[anonymous]

Give me an example? I've heard this before and this mantra is common place amongst Sales Managers, but in my opinion it just doesn't make any sense.

#1. 3rd or 4th position deal last month, similar offers between us and the competing lender (direct), they just beat us out by 6 points (1.34 against 1.40). Caught him on the phone while signing and gave a few horror stories about the lender he was signing with - had him sign ours instead, funded.

#2. Couple people on the board might be familiar with this one. Late AUG, manufacturing, texas. Competed with several brokers with this one. He had a questionable first and BLOC in place. First broker had a strong second offer (much better than my consolidation deal in all reality), told him another payment would kill his cash flow, made a realistic case, had him sign the consolidation. Lender pulled the deal, competing brokers exclusivity (30 day) ran out (after I thought the deal was deal on our end), lender contacted me with the offer, and I closed him on that same second within about 15min (after preaching how it would "kill cashflow, and he apparently had another consolidation offer on table at that time). Switched the pitch to annualized rate and long-term outlook. $150K, funded.

Every deal has it's own benefits (inferior or not). Find and exploit those benefits (no matter how irrelevant they may seem). Just a couple examples, have many more if you'd like.

[jotucker1983]

Sorry I know I'm late responding to this lol.

#1. 3rd or 4th position deal last month, similar offers between us and the competing lender (direct), they just beat us out by 6 points (1.34 against 1.40). Caught him on the phone while signing and gave a few horror stories about the lender he was signing with - had him sign ours instead, funded.

Remember you said you were going to provide an example of selling an inferior product?

If the competing lender was really "bad" as you say they were, then how would your product be inferior? The competing lender could very well have been providing a teaser rate that would have changed once "closing" started.

Just hope that the lender in question was really as bad as you made them out to be, I don't really use the tactics of bashing my competitors to make my product look better, I just focus on product comparisons.

As for the example with the consolidation/2nd position, again, how is this an example of selling someone an inferior product? The merchant had a choice between a 2nd or the consolidation, really depends on which direction he preferred, but neither are superior to the other, both are bad situations to be in quite honestly.

- The 2nd would add to cashflow issues by taking a higher percentage of his gross.

- The consolidation would have him paying "interest on top of interest" or paying off the same balance(s) twice.

Neither option is superior to the other, the merchant is in a bad situation and has to pick either slicing off his foot or his hand.

Every deal has it's own benefits (inferior or not). Find and exploit those benefits (no matter how irrelevant they may seem). Just a couple examples, have many more if you'd like.

100% agree, my point is that sometimes you have a deal that does not compete with other offers that the merchant has, and there's no "true and factual" value statements that you can provide to make your deal better than the other.

This doesn't mean you can't still win the merchant though, a lot of times you can win by simple fact that you already have them started with the process and are nearing the end, with the merchant not wanting to start the entire thing over again with another Broker.

I try to be 100% honest with merchants, if another deal is beating mine and I can't match it in terms of quality or price or something else that matters, then it's a better offer. But at the same time, I rarely run into this because like I said, I focus on providing the full solution and properly pricing merchants in the first place. I don't seek 10 points per deal.

[Zach]

Broker A will be selling the dream, rather than the product. Happens every day. A good salesman can close an inferior deal, have seen it done many times, and have even done it myself once or twice.

Anonymous, I love your signature